Billionaire Johann Rupert's Sukuma fund to offer $7.18 million loan to local restaurants

The R1-billion ($71.8 million) Johann Rupert Sukuma Fund for COVID-19 relief will loan R100 million ($7.18 million) to struggling restaurants in South Africa, News 24 reported.

Last year, the fund was created to distribute the R1 billion ($71.8 million) donated by Remgro Ltd. and the family of South African billionaire Johann Rupert to support small businesses that have suffered due to COVID-19.

The fund recently announced a partnership with the Federated Hospitality Association of Southern Africa (FEDHASA) to help preserve jobs in the hospitality industry.

According to FEDHASA, about 30 percent of restaurants had to shut down at the peak of the pandemic last year after a series of government-imposed lockdown measures. Despite the easing of the lockdown, many restaurants are still struggling to recover.

In a statement, the fund’s spokesperson David Morobe said that “the biggest challenges struggling restaurants still face is meeting their rental repayment obligations. While the rental for many of these businesses has been reduced, it remains a major operating cost that many restaurants are still struggling to cover with current cash flow levels.”

Only restaurants that are formally registered with the state, independent and have proof of financial solvency will qualify. Applicants must also be members of FEDHASA. Restaurants that have not yet registered with the association will qualify after they register.

Qualified restaurants will receive unsecured interest-bearing loans between R250 000 and R1 million each, to be repaid over five years. According to the report, the interest will be charged at the prime lending rate.* However, no interest or repayment obligation will be required of the loan for the first 12 months.

Remgro is an investment holding based in Stellenbosch, South Africa, with stakes in banking, financial services, packaging, glass products, medical services, mining, petroleum, beverage, food and personal care products.

Rupert is the chairman of Remgro. His stake recently gained $81.7 million on the Johannesburg Stock Market amid reports that Heineken N.V. was in talks to acquire Distell Group’s operations in South Africa.

Rupert has a net worth of $7.1 billion, according to Forbes.

*The prime lending rate (prime) is the interest rate commercial banks charge their most creditworthy customers. Generally large corporations.